How Do I Create an Employee Handbook?

Questionable T-shirts, work-from-home policies, and unlimited questions about unlimited vacation. An employee handbook is the operating manual you and your team need to solve any of these perplexing situations. Contained inside are breakdowns of the rules you expect your team to follow, and at the same time, what they expect you to uphold. It’s a handy little book that should feel as genuine to your team as the back of their hand.

In this article, we’ll show you how to put together an employee handbook that is an accurate mirror of your company’s beliefs. And when we start sketching it out together, you’ll end up with a handbook your employees will actually want to have propped up on their nightstand.

What makes a good employee handbook?

A good handbook protects you from possible liability while keeping your employees excited to come to work. It also helps everyone get on the same page about what they need to do when they get there. Whenever they have a question about a work-related policy, they should be able to turn to their handy little book to dig up an answer.

How to write your handbook

Step one: Set the stage

Before getting into the subject matter, make your employees feel stoked to be a part of your journey. Talk about your history, mission, and values, and add any other color that will bring your story to life. Have a hilarious anecdote? Drop it right in. Make it a point to write your handbook in a straightforward and fluid way that’s full of examples and stories. You want people to quickly understand everything they’re reading and feel proud to be a part of the company’s culture, story, and growth.

A good handbook isn’t just about what not to do — it should carve a path for those who want to “do.” Translation: the awesome people you call your team.

Step two: Lay out the basics

This is where your story takes shape. In this section, it’s important to talk about what your team can expect from you and what you can expect from your team. Before you begin, check out your state’s labor website to give you a rundown of all the policies you need to address from the get-go.

Workplace safety

It’s safe to say a workplace safety policy is a handbook must. Explain how you’re building a safe environment, from emergency readiness to following all the Occupational Safety and Health Administration (better known as OSHA) laws out there. Include any workers’ comp details here too.

Anti-discrimination policies

Federal and state regulations require many companies to outline their anti-discrimination policies in their handbooks. In fact, adding just a little bit of language can protect you from dealing with big litigations down the road.

Code of conduct

How are people supposed to act at work? This may sound like an odd thing to spell out, but it will give people a sense of what’s okay and not okay to do during the day. For example, it includes no-brainers like why you’re not allowed to harass people, along with other details like how people should treat their company property.

Compensation

This is your space to talk about everything related to how people are paid. It’s wise to really go into detail here. Set up clear compensation structures based on people’s experience and the role at hand so everyone can feel comfortable that they’re within their appropriate compensation band. Paint a picture of what the entire experience looks like.

What’s the method (direct deposit or check)?

What’s deducted from employee paychecks?

How often will you pay your team?

How many hours does an employee have to work to be considered full-time?

Are they eligible for overtime pay?

What does their base pay, bonus structure, and equity package look like?

Performance review logistics

What’s the path to advancement in your company? Point out milestones people need to meet to get bumped to the next level.

Overview of the benefits you offer

Do you provide health insurance, 401(k) plans, pensions, commuter assistance, or any other benefits? List it all out here. Share how the benefits you offer align with the specific values of the company. For example, if you have a liberal PTO policy, spell out why that is.

Eligibility requirements for benefits

Are dependents covered? Are benefits for full-timers only? Explain it all here.

PTO policy

How many vacation and sick days do employees earn? If there’s an accrual policy, explain how it works, and if you have unlimited vacation, outline the procedure for requesting and booking time off. Be sure to write out all the holidays you observe as well, and whether or not your office will be open on those days.

Other leave policies to explain:

Parental leave: The Family Medical Leave Act (FMLA) is required reading for anyone putting together a handbook. Use it to guide you through setting up a parental leave policy for your team.

Voting: Can your team leave work to vote? Brush through this rundown of state laws from FindLaw to see what you have to do, and then decide what you’d like to do to encourage your team to make their voices heard.

And a whole lot more: From being called to civil service to being the victim of a crime, there are an array of leave policies you could add to your handbook (in fact, there are more than 20 in California alone). This area of employment law has a lot of state-specific requirements, so be sure to take a closer look at the rules where you live (or talk to an expert).

Non-disclosure agreement (NDA)

By squeezing this into your handbook, you’re ensuring that your team won’t share any confidential information while they’re at your company. Be sure to check your state regulations around NDAs to ensure you’re staying compliant.

Conflicts of interest statement

Spelling this out helps people understand what your expectations are, and can help them from getting sucked into situations that could hurt your company.

Step three: Add the stuff your team cares about

Once you make it through the majority of items above, pepper in anything else that matters. These can include things like flexible work arrangements, social media policies, parking, cell phone usage, your dress code, and any of the other factors that are important to your team.

Employee handbook templates:

Step four: Get sign-off

Once you have a draft of your handbook, run it up the HR flagpole and get it in front of a lawyer so you can be extra sure you’re not missing anything crucial. Then it’ll be time to get your employees’ signatures. The final page of your handbook should be an acknowledgement form that employees sign to signal their understanding and access to your policies.

Step five: Keep it up to date

Employment laws frequently change, so you’ll need to stay on the ball to make sure your handbook is written to address new laws. That means having a lawyer or HR consultant review your handbook every six to 12 months.

And if you do make any changes to your handbook, make sure to have your employees sign new acknowledgement forms. The process of getting their signatures will help draw attention to any changes in your policies, and it can help prove they knew of any changes if you ever wind up in a dispute.

We’ve got to hand it to you — you’re now well on your way to becoming a handbook pro. Bust out those pencils and policies, and let the handbook fun begin.

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About Gusto

Gusto’s mission is to create a world where work empowers a better life. By making the most complicated business tasks simple and personal, Gusto is reimagining payroll, benefits and HR for modern companies. Gusto serves over 60,000 companies nationwide and has offices in San Francisco and Denver.